Maxine Kelly and Akila Quinio in London 5 HOURS AGO
UK house prices have recorded the largest annual drop in 14 years as rising mortgage costs pile pressure on the property market, according to data from Nationwide.
Prices for July fell 0.2 per cent on the previous month and 3.8 per cent compared with the same month last year, the largest fall since 2009, the Nationwide house price index showed.
The average cost of a home in the UK is now £260,828.
House prices have come under increasing pressure as lenders have increased mortgage costs in response to the Bank of England’s continued interest rate rises.In June, house prices remained broadly flat compared with the previous month, Nationwide’s data showed, but were 3.5 per cent lower than the same month last year.
Nationwide’s chief economist Robert Gardner said housing activity had become more subdued in recent months as the affordability of mortgages for prospective homebuyers had become “challenging”.
The lender said there had been 86,000 house sales in June, 15 per cent lower than at the same time last year and about 10 per cent below pre-pandemic levels. The price of a typical home, meanwhile, was 4.5 per cent below its August 2022 peak.
Data from the BoE on Monday, which showed a slight rise in mortgage approvals in June, was driven by activity that predated the more recent rise in longer term interest rates, Gardner said."
Imogen Pattison, assistant economist at Capital Economics, said the fall in house prices in July was “the first sign of the surge in mortgage rates since mid-May taking its toll”.
Mortgage rates have soared in recent months following successive interest rate rises by the BoE, which in June raised its interest rate to 5 per cent in an effort to tame stubbornly high inflation.
Economists and analysts said they expected house prices and sales volumes to drop further in the coming months, as they anticipated mortgage rates to remain around their current levels for another year"
FT.com
UK house prices have recorded the largest annual drop in 14 years as rising mortgage costs pile pressure on the property market, according to data from Nationwide.
Prices for July fell 0.2 per cent on the previous month and 3.8 per cent compared with the same month last year, the largest fall since 2009, the Nationwide house price index showed.
The average cost of a home in the UK is now £260,828.
House prices have come under increasing pressure as lenders have increased mortgage costs in response to the Bank of England’s continued interest rate rises.In June, house prices remained broadly flat compared with the previous month, Nationwide’s data showed, but were 3.5 per cent lower than the same month last year.
Nationwide’s chief economist Robert Gardner said housing activity had become more subdued in recent months as the affordability of mortgages for prospective homebuyers had become “challenging”.
The lender said there had been 86,000 house sales in June, 15 per cent lower than at the same time last year and about 10 per cent below pre-pandemic levels. The price of a typical home, meanwhile, was 4.5 per cent below its August 2022 peak.
Data from the BoE on Monday, which showed a slight rise in mortgage approvals in June, was driven by activity that predated the more recent rise in longer term interest rates, Gardner said."
Imogen Pattison, assistant economist at Capital Economics, said the fall in house prices in July was “the first sign of the surge in mortgage rates since mid-May taking its toll”.
Mortgage rates have soared in recent months following successive interest rate rises by the BoE, which in June raised its interest rate to 5 per cent in an effort to tame stubbornly high inflation.
Economists and analysts said they expected house prices and sales volumes to drop further in the coming months, as they anticipated mortgage rates to remain around their current levels for another year"
FT.com
